This is remarkable in the sense that not every company or every company’s offering is profitable in the cloud space. Broadcom definitely just looked at the numbers and decided this service should be cut wholesale.
Is it right? It’s a corporation that just spent $61 billion on this, when were they ever concerned about right and wrong? They exist to gobble profit.
The thing about running your business on other people’s computers, you can’t decide where it gets to run
I feel that we will soon see a shift where organizations will start moving back to on-prem instead of paying for cloud services. We have begun to see our larger customers opting for migrating back to on-prem from the cloud.
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Exclusive Broadcom is tossing the majority of VMware’s Cloud Services Providers as part of its shakeup of the virtualization titan’s partner programs, say sources, leaving customers unclear who their IT supplier will be.
A month later we revealed that Broadcom intended to discontinue VMware’s channel program, and that some solution providers/ resellers would be transitioned to its own scheme, but on an invitation-only basis, from February.
Chatter among some in the industry is that Broadcom is only interested in keeping the largest and most profitable customers, and the company simply doesn’t care about the smaller users and the providers that service them.
“This all sounds very much like Broadcom taking an aggressive approach to its route to market and focusing on those partners that can deliver growth and significant revenue,” said Omdia chief analyst Roy Illsley.
This would be ironic as Broadcom itself used the spin that its takeover of VMware would actually lead to more competition in the cloud market, back when it was trying to sweet talk European Union antitrust regulators into giving it the go-ahead.
The notion that the Broadcom-VMware merger might stifle competition was precisely why various regulatory bodies around the globe decided to look closely at the deal before allowing it to proceed.
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Microsoft hyperV and azure will keep munching on their business.
As is the plan.
Broadcom’s whole business model is to buy companies with lots of enterprise customers and high vendor lock in products, cut support, maintenance, R&D as much as possible, and massively jack the price up. Most customers will eventually leave, but they’re counting on sunk cost fallacy and management being slow to go through with a big, risky, and expensive migration to make their money back in the meantime. Anyone who gets stuck with it long term because they would rather pay up than risk moving is just a bonus.
Sure, but with this change it’s becoming harder to see the advantage of VMware over hyperV with full lintegration to azure, and azure stack edge. A single interface to manage cloud and on prem that includes monitoring etc.
Sunk cost or not, with this change the companies need to move anyway so the immediate question is why not all the way? but I might be wrong.
My guess is that there arn’t enough big fish using the cloud providers as compared to rolling their own in house, and they did say that the biggest would be invited to a new program. They want to drive off the little fish, because they cause most of the problems and especially the ones using MSP’s like we’re talking about here are going to be the fastest to jump ship to Azure or AWS hosting anyway.
It’s not a sustainable long term plan, but Broadcoms long term plan is to kill VMware entirely so that’s not a concern to them.
